A macroeconomic equilibrium occurs when the
A) quantity of real GDP demanded is greater than the quantity of real GDP supplied.
B) quantity of real GDP demanded equals the quantity of real GDP supplied and both equal potential GDP.
C) quantity of real GDP demanded equals the quantity of real GDP supplied even if they are not equal to potential GDP.
D) quantity of real GDP demanded is less than the quantity of real GDP supplied.
E) None of the above answers is correct.
C
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Refer to the above table. Suppose one country has a per capita real GDP of $1000 and another has a per capita real GDP of $10,000, or ten times larger. If both countries have a growth rate of 5 percent, how much larger will per capita real GDP be in the second country be than the first after 50 years?
A) 8 times larger B) 5 times larger C) 10 times larger D) 4 times larger
Refer to Figure 5-11. S1 represents the supply curve that reflects the private cost of production and S2 represents the supply curve that reflects the social cost of production
One way to internalize the external cost generated by utilities is to impose a Pigovian tax on the production of electricity. What is the size of the Pigovian tax that will internalize the cost of the externality? A) P2-P0 B) P1-P0 C) P2-P1 D) P0